Why transition planning for Asian clients is ‘very complex’

Maggie Liu, director of Asian Wealth Advisory at Bordeaux

"There's a lot of underserved clients in the space and they need a lot of help," says an advisor to the community.

As one of the few Asian-American advisors in the independent space, Maggie Liu, director of Asian Wealth Advisory at Bordeaux Wealth Advisors is on a mission to make the community more prominent within the profession.

She leads a small team of six other like-minded Asian advisors who cater to their clients’ financial needs as well as help increase prominence among advisors in the Asian community.

“Based on 20 years in the business, I just haven’t come across that many [Asian advisors],” Liu admits. “If firms do have any, usually it’s just one person who’s an advisor or portfolio manager or another role in the company that speaks Mandarin, but not to a standard where our advisors are professionally.”

Born in Taiwan, she moved to the US and became a financial planner. The accumulation of her life experiences and understanding the history of different Asian countries are just a few of the reasons why she decided to settle down on the niche at the California-based firm.

“There’s a lot of the political items that you’ve heard about, but our roots are the same,” Liu says. “The language and usage are the same. There is also a huge population of redomicile and moving over here over the last 30 or 40 years from different countries.”

Liu explains most of the time, clients tend to make the move out of their countries for several reasons, ranging from political motivations to simply looking for a different place to restart their lives or getting better education for relatives. Among the challenges stemming from that decision, especially in the wealth space, is having to deal with new financial systems.

“There’s the wealth, cash flow, investment vehicles that they need to start off in this new country, with several different tax laws, different investment vehicles and different financial planning.”

The complex nature of international cross-border planning makes it one of the main challenges Liu faces in dealing with her clients. Oftentimes, her clients will still maintain assets and businesses in their country of origin which means complexity in terms of different countries, tax laws and how the United States looks at their foreign assets.

“Like when they get taxed and when they don’t, and do they get counted as part of the estate transfer? That makes the general trusts and estate planning more difficult as well because most of the estate that we can only handle is the US law governs what is over here. There’s a lot of that transition planning and it is very challenging, very complex,” Liu said.

In the state of California, Liu highlighted there tends to be several advertisements in Chinese. While the message may look the same, the difference comes down to what the advisor is offering, she says.

“You see a lot of insurance-focused or product-focused type of advisors. There’s not much in the independent RIA space. They’re more of a salesperson focused on one solution, very product-focused, less holistic planning, in terms of taxes, estate, trust, that kind of comprehensive approach,” says Liu.

“That’s been the trend in the industry for a long time. We have a good spot to continue to develop this in the ultra-high-net-worth space, but with a focus on Asians’ wealth to give them a holistic wealth management approach for the whole family together.”

Chinese New Year is when Liu and her advisors see an influx of clients looking for financial planning services because that’s when they start to plan out their New Year resolutions and other plans, Liu highlighted.

“There are big celebrations, people are setting up new things, or taking the chance to gift things to their children and grandkids. They’re in the right mode to want to plan for something.”

Liu says Bordeaux coordinated a few Chinese New Year events for their clients. For example, this year, the firm did three different Chinese Lunar New Year dinners, inviting clients and prospects to “be more social, casual, and interactive. Most people ask, ‘Well, what’s the election year going to look like? Can you give us a heads up on something?’ It opens that conversation up and it’s a great time for them to think about it.”

The most rewarding part for Liu, at the end of the day, is being able to educate her clients on what it takes to make a good financial plan.

“There’s a lot of underserved clients in the space and they need a lot of help. How we play this role is a matter of reaching out and matching the type of clientele for each firm. We’re looking forward to seeing more Asian and white advisors in the space but if you’re Asian and female on top of that, that’s even a bonus. There’s not that many female advisors out there either.”

Name: Maggie Liu
Position: Director of Asian Wealth Advisory
Company: Bordeaux Wealth Advisors
Founded: 1969
AUM: $4.4 billion